Thursday, 16 September 2010

UK: Bribery Act 2010 consultation - guidance for commercial organisations on preventing bribery

Section 7 of the Bribery Act (2010) provides for a new strict liability offence: the failure by a commercial organisation to prevent bribery by a person associated with it. A defence is available where the organisation has in place adequate procedures designed to prevent such behaviour. Section 7 comes into force next April.

Section 9 imposes an obligation on the the Secretary of State to publish guidance about the procedures that commercial organisations can put in place to prevent associated persons from bribing. In this regard, the Government, through the Ministry of Justice, has published draft guidance for consultation: see here (pdf). This guidance consists of six principles which the Government considers should inform the procedures organisations have in place to prevent bribery:
  • Risk assessment: the organisation regularly and comprehensively assesses the nature and extent of the risks relating to bribery to which it is exposed.
  • Top level commitment: the top level management of a commercial organisation (be it a board of directors, the owners or any other equivalent body or person) are committed to preventing bribery. They establish a culture within the organisation in which bribery is never acceptable. They take steps to ensure that the organisation’s policy to operate without bribery is clearly communicated to all levels of management, the workforce and any relevant external actors.
  • Due diligence: the commercial organisation has due diligence polices and procedures which cover all parties to a business relationship, including the organisation’s supply chain, agents and intermediaries, all forms of joint venture and similar relationships and all markets in which the commercial organisation does business.
  • Clear, practical and accessible policies and procedures: the commercial organisation’s policies and procedures to prevent bribery being committed on its behalf are clear, practical, accessible and enforceable. Policies and procedures take account of the roles of the whole work force from the owners or board of directors to all employees, and all people and entities over which the commercial organisation has control.
  • Effective implementation: the commercial organisation effectively implements its anti-bribery policies and procedures and ensures they are embedded throughout the organisation. This process ensures that the development of polices and procedures reflects the practical business issues that an organisation’s management and workforce face when seeking to conduct business without bribery.
  • Monitoring and review: the commercial organisation institutes monitoring and review mechanisms to ensure compliance with relevant policies and procedures and identifies any issues as they arise. The organisation implements improvements where appropriate.
For further information about the Act see here.

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